The Year the Fight Against Inequality Went Mainstream

Even Republicans are getting in on the act. But the issue's reach is still limited by age-old political realities.

December 9, 2015

Democrats have been rallying against inequality long before a grumpy socialist ran for president. Barack Obama in 2012 called for a new minimum tax for millionaires and billionaires on his way to defeating an opponent he painted as an out-of-touch plutocrat. Even Bill Clinton ran in 1992 on a plan to tax the top 2 percent of earners to fund tax relief for ordinary Americans (though he ultimately abandoned the proposal to focus on deficit reduction). But Bernie Sanders’s insurgent campaign reflects a party that’s seized on the issue of economic disparity as “the defining challenge of our time,” as Obama himself put it.

Sanders’s determination to run as a single-issue candidate hasn’t been a great political strategy in recent weeks, as the focus of the race has rapidly shifted to terrorism and foreign policy. But in many ways, his campaign has already accomplished its mission: to force inequality to the forefront of the Democratic primary and move the party’s center of gravity leftward on the issue in 2015 and beyond. “The top one-tenth of 1 percent today in America owns almost as much wealth as the bottom 90 percent,” he said in a speech at Liberty University in September. “And in your hearts, you will have to determine the morality of that, and the justice of that.” Just a few weeks later, at the first Democratic debate, Hillary Clinton was forced to defend the very merits of capitalism—but not before decrying the need to curb the excesses behind “the kind of inequities we’re seeing in our economic system.”

This is partly because the push for economic populism has come not just from outsiders, but also from within the Democratic establishment. After the party took a drubbing in the 2014 elections, the Democracy Alliance—a group of wealthy liberal donors—shifted gears to focus on economic inequality, in part by funding more groups aligned with the populist left, as National Journal’s John Judis details. These donors have helped put more institutional muscle behind the focus on inequality, funding left-leaning think-tanks like the Roosevelt Institute and the Center for American Progress, which is closely aligned with the Clinton campaign. Both groups have put out detailed reports that focus on reducing economic disparities through investing in infrastructure, eliminating corporate tax breaks, and raising women’s labor-force participation—all policies that both Sanders and Clinton have embraced in some form.

In an about-face, Republicans have tried to seize on the issue this year as well, though in their own fashion. “The truth of the matter is, big government benefits the wealthy, it benefits the lobbyists, it benefits the giant corporations,” Senator Ted Cruz said during October’s GOP debate. “And the people who are getting hammered are small businesses, it’s single moms, it’s Hispanics. That is who I’m fighting for.” At the same debate, Ben Carson similarly blamed government regulation for hurting ordinary Americans: “Doesn’t hurt rich people if their bar of soap goes up ten cents, but it hurts the poor and the middle class.” Even Romney has gotten in on the act, decrying that “under President Obama, the rich have gotten richer, income inequality has gotten worse.”

Republican ideas, however, haven’t taken the same turn as their rhetoric. The reality is that Carson, Cruz, and Jeb Bush all support tax policies that are the inverse of the Democrats’. They benefit the wealthy far more than ordinary Americans, with the assumption that spectacular growth will take care of the rest.

Democrats, for their part, are also using economic populism as a kind of political crutch. By narrowly focusing on the very rich and corporations to fund its economic priorities, as Clinton is likely to propose next year, the party is limiting the reach of policy solutions that would actually combat the broader problem of inequality. And here we see the ways in which the inequality craze comes crashing into some stubborn, but unavoidable, realities of American politics.

Despite the party’s newfound romance with economic populism, Clinton’s platform suggests that she essentially agrees with Republicans that higher taxes and big government are Democrats’ biggest political vulnerabilities. Like Obama, Clinton has vowed not to raise taxes on middle-class Americans, which national Democrats have defined repeatedly as those earning up to $250,000 per year. Though she’s yet to release a detailed tax plan, her central message isn’t likely to sound very different than what Obama has promised for years: Those most in need of help are the middle class—as Democrats have defined it—and the burden of helping them should fall entirely on the wealthiest households and corporations, which will bear the taxes as punishment for the excesses of capitalism.

Many progressives have bemoaned the fact that Clinton has drawn such a line in the sand on taxes before the general election has even begun. But the bigger problem is that the public’s growing concern about inequality hasn’t erased its skepticism of government solutions to inequality, a political dilemma that Democrats have yet to resolve.

A recent study conducted by economists from Princeton, Harvard, and University of California, Berkeley professor Emmanuel Saez—one of the most prominent researchers on inequality—put the political challenges of the issue in sharper relief. Based on a survey of 10,000 Americans, the study found that those who received more information about inequality were more likely to believe that economic disparity was a problem. At the same time, “they show no more appetite for many government interventions to reduce inequality”—such as an expansion of the Earned Income Tax Credit and food stamps—“with the notable exceptions of increasing the estate tax and the minimum wage.”

The study hypothesizes that Americans are more comfortable with government solutions when they’re narrowly targeted or otherwise limit government involvement. That suggests that any kind of broad government intervention will be a hard sell to the broader public, even if the public believes the scales are unfairly tipped because of government policies. “Respondents who have learned the role of government in creating the current level of inequality seem to be telling us they do not trust that government is also the entity to address the problem,” the authors conclude.

In some ways, the findings bolster the Democrats’ case for focusing on Republican tax policies: Everyone from Marco Rubio to Rand Paul has proposed to eliminate the estate tax entirely. But Democrats could risk losing lower- and middle-class voters who view their proposals to fight inequality as a Trojan Horse for more bureaucracy and higher taxes on their own households.

Republicans are already trying to play to these fears. Listing the spending proposals that she’s rolled out so far, the Republican National Committee warned: “Clinton has yet to explain how she will pay for her proposals except for vaguely worded promises of higher taxes.”

Though her rhetoric on the issue has gotten sharper, Clinton has already signaled that such predictable GOP attacks will curb the kind of populism that she’s willing to embrace. She’s aggressively pitched herself as a savior of the middle class, focusing on targeted, bread-and-butter proposals—reduced college tuition, paid leave, and so forth—rather than sweeping structural reforms. She’s yet to release a detailed tax reform overhaul, but she already declared upper-middle-class households off-limits. The reason that Bernie Sanders has refused to draw the same line is, in part, because he’s proposing broad, universal programs that will be paid for by a broad swath of Americans—though he hasn’t entirely explained how he’ll do that either.

The Democrats’ talk of soaking the rich will continue if Clinton is the nominee, but that’s partly because her proposed solutions are relatively incremental. By forswearing tax increases on the middle class out of political caution, Clinton will only be able to squeeze so much out of top earners and corporations to fund her priorities, ultimately restricting the potential sweep of her proposed agenda.

Compared to the GOP’s near-uniform proposals to give tax huge relief to the wealthy, Clinton’s general approach is undoubtedly progressive. But it’s really another formulation of the inequality agenda that Democratic candidates have been running on for decades.

Suzy Khimm is a journalist based in Washington, D.C., and a former staff writer for the New Republic, MSNBC, and The Washington Post.